Apple isn't saying. Quattro posted a blog that told their current customers not to worry - normal business operations would continue. So, I am speculating a bit.
The first questions I've fielded are, "Does Apple want to go head to head with Google?" or "Does Apple want to sell advertising?" At a high level, I believe businesses stick close to their core competencies. Apple sells hardware, software and some content. Google sells advertising. Well, mostly. There are about 4 billion cell phones worldwide and about 1 billion PC's. New Internet connects (and page views and advertising growth) will come from mobile. Mobile is high growth. PC's are a bit commoditized. My cell phone costs more than my last netbook or notebook purchase. Go figure.
Our mobile marketing foreast for the US shows revenue growing from $391M in 2009 to $1.3B in 2014 provided there aren't any game changers. Game changers? Anything that would dramatically impact the amount of inventory or the value of it. The Apple iPhone, for example, dramatically altered the number of page views or inventory in mobile. The Android phones are helping as well and gaining momentum. These numbers are US-only - growth in mobile globally has been dramatic as well and will continue to be. In the US alone (see my colleague Charlie Golvin's blog) smartphone adoption grew from 11% at the end of 2008 to 17% at the end of 2009. This is significant because a lot more browsing and application downloads happen on these phones than more basic ones. A cut of this revenue would add some to Apple's bottom line, but very small at least in the next few years.
...(Subtitled) Or at Least Marketing as We Know It!
But first, since this is my first blog post as a Forrester analyst, I thought I'd make a quick introduction. I'm Augie Ray, a new Sr. Analyst of Social Computing serving interactive marketing professionals. Prior to joining Forrester's Bay Area office, I was a Managing Director at Fullhouse, a social and interactive communications agency in Milwaukee, WI. I'm very excited to be part of the Forrester organization and eager to help clients with research, data, and consulting on the profound and exciting changes underway with Social Media Marketing.
Today the long-anticipated joint venture betweenConde Nast, Hearst, News Corp, Time Inc and Meredith Publishing became official. These firms -- all of them up against the ropes in an effort to deal with declining magazine ad revenue and the lackluster performance of online ad models -- have decided that to face the digital future, they'd rather do it hand-in-hand.
The motivation for the union is simple: eReaders are taking over the book publishing world, meanwhile magazines are left in the dust, with no devices they can call their own.
I mean, really, have you tried to read Business Week on your eReader? It ain't pretty. And on the Kindle, most magazine publishers want to charge you for the painfully slow page turning experience of the device all in exchange for the convenience of automatic delivery to your portable device. So the industry -- seeing a world that is evolving without their interests in mind -- is joining hands to solve two problems:
You may have seen the news about Marvell Technology Group, a chip-maker, integrating its chips into E Ink's display modules. This sounds very tech-y, but it has real consequences for the consumer experience of eReaders. Namely:
It speeds up the refresh rate of the E Ink screen...One of the first things consumers notice when trying out an E Ink-based eReader is the noticeably long delay when flipping a page or taking another action like changing the text size. This is especially annoying on touch devices like the Sony Touch Edition. Consumers are used to the iPhone touch experience, and the experience they have on the Web clicking on links--if they don't get immediate feedback, they assume it's not working. Currently, the microprocessing chip operates outside the display module, which is one reason why it's so slow. Integrating the chip into the E Ink display module will speed up the refresh rate of the screen by as much as half, according to Marvell, in addition to driving down manufacturing costs.
...Which creates a better user experience, and enables animation and other cool stuff. In addition to being generally less annoying for consumers, integrating the chip into the display will enable animated content--not full-on video, but black-and-white animation that will be useful especially for ads. Marvell has announced that they're working with FirstPaper (the secretive company backed by Hearst) as one of their partners, and having seen their device I can attest that they put the technology to good use. Marvell has said they'll announce more partners at CES in January, including companies working on dual-screen devices that need the faster processing capability for video and Web browsing
I am in mourning over the death of Gourmet Magazine. There's a revolution going on on Twitter (follow @savegourmet and search gourmetmagazine to see how it's developing) that I've been contributing to. But I'm taking off my fan hat and putting on my analyst hat to contribute something data-driven to the conversation.
I've been looking at some new, as-yet-unpublished data that I'm using in an upcoming Forrester report on reinventing magazine and newspaper subscriptions. Here's a preview:
And here's the same question cut by subscribers to any of Conde Nast's publications:
In other words, 19% of Conde Nast subscribers think their magazine subscriptions are "surprisingly inexpensive," compared with 13% of US consumers in general. The takeaway: Conde could probably be charging more for its subscriptions.